Vegetable, onion growers face ongoing squeeze: New report

Rising costs of production, including wages, are putting the squeeze on Australia’s vegetable and onion growers, according to the second national benchmarking report on the sector.

The Level Up Hort report released during Hort Connections in Brisbane earlier this month (5 June) provides a nationwide snapshot of the Australian vegetable and onion industries, highlighting their strengths and some of the challenges faced by growers.

Analysis of farm business performance during 2024 or 2023-24 showed the average of all growers generated profit (measured as earnings before interest and tax) of $4,233/ha, while the least profitable recorded an average loss of $8,522/ha.

The top 25% of vegetable and onion businesses generated average profit of $17,353/ha.

Level Up Hort project leader Steff Carstairs said almost twice as many businesses took part in 2024, making it difficult to draw overall comparisons with the previous year.

Analysis of businesses that took part in both years showed some did better and some did worse in 2024. However, farm equity, return on assets managed and EBIT margin – funds left over to cover finance, tax obligations and reinvest in the business or elsewhere – were all lower than in 2023.

Ms Carstairs said the decline in position echoed anecdotal reports of continuing hardship for many vegetable growers, which has been aggravated by conditions such as drought, heat, floods, and rising labour, electricity and transport costs.

“Lots of localised issues collectively have had a negative impact on the industry,” she said.

“Rising costs has had the biggest impact. And without that parallel growth in income, labour continues to be a hot topic ... there’s been a lot of discussion around labour, increased costs of labour and challenges with securing and retaining labour. In general, labour continues to be a pain point for horticultural businesses, and a major cost. Those who seem to be doing better have greater efficiencies around their labour management.”

For the most profitable businesses, labour accounted for 35% of income, compared to 36% for average growers and 51% for the least profitable.

Data in the report represents businesses producing 5,596 hectares of vegetables and onions in New South Wales, Queensland, South Australia, Tasmania, Victoria and Western Australia.

The Level Up Hort program is a five-year initiative fully funded through Hort Innovation, providing specialised business consulting valued at up to $10,000 per year, through project partners Planfarm and RMCG.

Hort Innovation chief executive officer Brett Fifield said the report will be used to help guide growers in their decision making and implementing on-farm practices.

“It is very difficult to manage what you can’t measure, so Hort Innovation has funded the Level Up Hort project to help gain a further understanding of the vegetable and onion industries via consistent benchmarking,” he said.

“Out of this project, we hope over time to get enough data to share valuable insights that will support both new and experienced vegetable growers with their decision making to improve drivers around productivity, quality and profitability.”

Ms Carstairs said the project was accepting new participants who will receive two reports: a full business analysis and a private benchmarking report comparing their figures against others.

All data is de-identified, aggregated and reported on a per hectare basis or as ratios to ensure no business can be identified by features such as name, location, yield or crop type, she said.

A free webinar on Wednesday, 9 July, will be held to discuss the key findings of the benchmarks, implications for vegetable businesses and ongoing challenges facing the industry. The webinar will be presented by project

delivery partners Planfarm and RMCG.

Register for the webinar, which starts at1pm (AEST), 12.30pm (ACST),11am (AWST), atleveluphort.com.au

To enquire or enrol in the Level Up Hort program, contact Steff Carstairs on 0428 712 852, email steff@planfarm.com.au or go to the website leveluphort.com.au for more information and FAQs.

Level Up Hort is funded through Hort Innovation, using vegetable and onion research and development levies together with contributions from the Australian Government (MT22009).

Hort Innovation is the grower owned, not-for-profit research and development corporation for Australian horticulture.
 

TOP FIVE EXPENSES

Cost ($/ha)	Most profitable	Average	Least profitable
Labour	$40,384	$26,341	$30,944
Seed and seedlings	$8,342	$4 ,150	$2,380
Cartage	$6,333	$3,600	$4,606
Packaging and materials	$5,639	$3,510	$3,312
Fertiliser	$5,540	$3,013	$2,262

Source: Season 2024 National Vegetable and onion benchmarks